Oiling the wheels

14 November 2018

The global oil market is growing, with new trends and sustainability issues being ever present. GlobalData reviews the current market, offering unprecedented insight.

The global oils market registered a positive compound annual growth rate (CAGR) of 0.75% in 2011–16, with a sales value of $84 billion in 2016, a 2.76% increase over 2015. The market’s strongest performance was in 2013, when it grew by 3.48% from the previous year; 2015, on the other hand was its weakest year, due to a 5.30% dip from 2014.

Vegetable oil was the market’s fastest-growing segment in 2011–16 with a 2.55% CAGR. The poorest performance belonged to sunflower oil’s CAGR of -3.26% during the same time frame. In 2016, vegetable oil accounted for 64.24% of the international marketplace and was valued at $54.14 billion, while olive oil came in second with a 12.98% share.

Looking ahead, the oils market is expected to expand at a CAGR of 7.85% in 2016–21, raking in a sales value that exceeded $1.2 million. This showcases a growth rate of 0.75% from 2011.

Again, vegetable oil is set to be the leading segment of the oils market during 2016–21, achieving a CAGR of 9.09%. Olive oil is forecast to lag behind with a CAGR of 3.41%. By 2021, vegetable oil is expected to account for 68.02% of the total oils market. In comparison, the olive oil industry is predicted to come in second place, taking up 10.52% of the market in 2021.

Volume wise, the oils market gained a positive CAGR of 5% throughout 2011–16, achieving sales of 32.78kg/billion in 2016 – an increase of 5.31% from 2015 and an improvement from a low point in 2012. (The market is also forecast to register a further CAGR of 5.58% during 2016–21.) That same year, vegetable oil became the largest sector in terms of volume, with an 69.94% slice of the industry, while sunflower oil trailed behind with 17.33%.

In 2016–21, the oils market’s volume is estimated to bring about sales of 43.01kg/billion by the latter year, rising by 67.42 and 31.2% from 2011 and 2016, respectively. When analysing volume sales of the industry by segment, it has been observed that vegetable oil will bring about sound growth during the forecast period, showcasing a positive CAGR of 6.12%. The lowest-operating segment is predicted to be olive oil, due to its estimated CAGR of 1.91%. By the end of the time frame, vegetable oil is expected to take pole position, with a 71.75% portion of the volume for the oils market.

A long look at Europe’s lucrative oils market

Despite the European oils industry registering a negative CAGR of -4.21% in 2011–16, its $24 million sales value for 2016 was actually an increase of 0.17% over 2015. The market’s strongest year came in 2013, when it grew by 4.15% from 2012. The weakest period, 2015, experienced a sharp decline of -17.31% from the previous year.

Although negative growth rates were observed across all European oil segments in 2011–16, the sector with the slowest rate of decline was olive oil, which had a -3.33% CAGR. In 2016, the EU’s vegetable oils offering accounted for a significant 40.11% share, while olive oil came in second place with 27.70% of the marketplace.

Looking ahead, the oils market is expected to grow by a CAGR of 3.31% throughout 2016–21, reaching an eventual sales value of over $28 million in 2021.

Sunflower oil is expected to be the fastest-growing area during this time and is expected to reach a CAGR of 5.17%. The opposite is true of corn oil, which is predicted to observe a CAGR of 1.43%. By 2021, vegetable oils are projected to make up 39.19% of the total oils space, whereas olive oil is predicted to hold 26.91% of the market.

In terms of volume, the industry registered a positive CAGR of 2.92% in 2011–16, obtaining a volume sale of 7.79kg/billion in 2016. This was not only the oils market’s best performance, but also an increase of 3.11% from 2015. In 2016, the most dominant area of the oils market was sunflower oil for volume, holding a share of 47.52%; vegetable oil followed closely behind with 29.16%.

Over 2016–21, the market volume of oils is estimated to generate sales of 9.14kg/billion by the latter year, displaying 35.55 and 17.40% growth from 2011 and 2016, respectively.

On analysing sales by segment, it has been noted that, similar to value, 2016–21 will be a lucrative period for sunflower oil, with a forecast CAGR of 4.60%. The weaker sector, on the other hand, is expected to be olive oil, which should observe a CAGR of 1.42%. By the end of 2021, sunflower oil is predicted to have the biggest share of the oils market, taking 50.70% of it.

An analysis of the North American market

Meanwhile, in the US, the oils market recorded a CAGR of 0.38% throughout 2011–16. A sales value of $8.3 billion in 2016 was also a welcome increase of 0.14% over 2015. The market’s stand-out performance was in 2013, when it grew by 2.40% from 2012; however, 2015 was the worst year, as the market dropped by -2.52% from 2014.

Interestingly, the fastest-growing area of the oils market in North America in 2011–16 was cooking sprays, which had a CAGR of 1.35%. The weakest performer was other edible oils with a lacklustre -0.30% CAGR.

In 2016, the country’s vegetable oil sector accrued a major 57.67% share of the market, while olive oil took a 15.80% cut.

Over the next few years, the oils market is expected to expand at a CAGR of 3.11% in 2016–21, obtaining a sales value of $9.71 billion by 2021.

Other edible oils looks set to be the most prolific segment in the industry for this period, with an expected CAGR of 3.97%. Cooking sprays, on the other hand, are forecast to lag behind, due to a 2.31% CAGR. By 2021, vegetable oils could make up 58.05% of the total oils market. Olive oil, in comparison, has a much smaller stake at 16.00%.

In terms of volume, the market registered a positive CAGR of 2.41% in 2011–16, which amounted to volume sales of 2.55kg/billion in 2016 – an increase of 2.62% from 2015 and its best performance since its weakest point, 2012. Also in 2016, the industry’s largest volumes came courtesy of vegetable oil’s 70.51% market hold. Corn oil came in second, but only garnered a 15.41% portion.

For 2016–21, the volume of oils is estimated to generate sales of 2.94kg/billion by 2021, illustrating an increase of 30.05 and 15.4% from 2011 and 2016, respectively.

Segment analysis of volume sales shows that, contrary to values, the vegetable oil sector is set to attain a sound growth rate in 2016–21, with a strong CAGR of 3.16%. Sunflower oil, however, is predicted to be the poorest performer, registering a 1.94% CAGR. By the end of 2021, vegetable oil is set to lead by commandeering 71.35% of the total market.

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